Spanish Government owes Brits thousands

Thousands of Brits who have sold a property in Spain in recent years could be owed a 20% tax rebate to the tune of £50m – or a massive £11,000 each.

CGT Scam: The Spanish Government could owe you thousands if you sold a property there between March 2004 and December 2006

Britons who have sold a Spanish residence between March 2004 and December 2006 could be owed the cash as a result of a Spanish Government's capital gains tax (CGT) 'scam' according to Spanish lawyers Costa, Alvarez, Manglano & Associates (CAM&A) and currency exchange brokers HiFX.

British non-residents who sold their Spanish properties during this period paid a Spanish Non-Residents' income tax rate of 35% on any capital gains, compared to a rate of 15% paid by Spanish nationals.

This 20% overpayment not only totals a profit somewhere in the region of £37m before interest owed, but also contravenes European Community Treaty rules on discrimination and therefore was unduly charged by the Spanish Government, say CAM&A.

Putting an exact total on the amount of people affected is very difficult as the Spanish Government does not want to disclose this information, says HiFX.

But it believes a conservative estimate would be 4,500 British people and with each owed some £11,000 - that brings the total bill to £49.5m. Thousands more residents in other European countries, would also have been affected by the capital gains issue, after having sold a property in Spain over the three-year term.

Those people who sold a property previous to January 2004 have already missed out as claims can only be made dating back over a four year period, meaning millions more have already become victim to this tax trap.

HiFX, together with CAM&A are calling for British people to come forward and register their details to be part of what could be the biggest class action against the Spanish tax authorities for many years.

Emilio Alvarez, a lawyer at CAM&A, says: 'Anyone who has sold a Spanish property between March 2004 and December 2006 will have been victim to this inflated capital gains tax rate, which saw non residents scammed into paying inflated CGT bills by as much as 20%. This tax trap is thought to have affected hundreds of thousands of people across Europe and in the UK.

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'A change in the law at the start of 2007, which saw the standard capital gains tax for non residents being brought in line – a reduction from 35% to 15%, passed by largely unnoticed. As a result, thousands of people who had previously sold property in Spain are entitled to a 20% rebate, thought to average at £11,000 each including interest.

'Due to stringent legal restrictions people who bought at the end of 2003 have already missed out, as claimants must register within four years, but thousands of Brits can still join forces and fight to get the Spanish tax authorities to pay back the money owed.'

For more information and details of how to register your interest, visit spanishtaxreclaim.co.uk or call the Spanish Tax Reclaim Helpline on 0845 680 3849 or email: info@spanishtaxreclaim.co.uk

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